AT&T Tries to End Old Rate Dispute

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AT&T Broadband & Internet Services and regulators
in Arlington, Texas, were still trying to negotiate a settlement last week that would end
four years worth of rate disputes.

City officials are haggling with the MSO over rate hikes
dating back to 1996 -- when the suburban Dallas system was operated by Tele-Communications
Inc. -- which have continued to sit unaddressed at the Federal Communications Commission.

Having missed an Oct. 5 deadline, Jennifer Howry, assistant
to the city manager, said she hopes to have a final agreement ready for the City Council
next week.

After having its latest offer rejected, AT&T Broadband
was expected to respond to the city's Oct. 7 counteroffer by last Wednesday, MSO
spokeswoman Angel Biasatti said.

"There really is no problem," she said. "We
want to settle this as much as the city of Arlington does."

At issue is the size of the refund the city is seeking for
61,000 AT&T Broadband subscribers in the Dallas suburb, Howry said.

"We're really not that far apart," she
added. "I don't think it's anything we can't meet in the middle

In its 1999 rate order, Arlington demanded that AT&T
Broadband cut 13 cents per month off its basic rate. The MSO obtained an emergency stay
from the FCC that allowed it to charge the higher rates, while preventing the city from
enforcing an ordinance making it a criminal misdemeanor for the company not to abide by
the city's rate order.

An agreement in Arlington would settle two of the three
major rate disputes AT&T has in the Dallas Metroplex.

The company recently said it will pay out a total of
$967,000 to 50,000 subscribers in nearby Plano, Texas, ending four years of squabbling in
that jurisdiction.

Under the Plano deal, cable viewers get $4.98 credits
during each of the next four months. AT&T Broadband will also stop collecting a
30-cent-per-month surcharge it had used to recover the cost of unpaid franchise fees, and
it will contribute $133,000 to the city.

However, the operator still needs to settle with
neighboring Richardson, Texas, which won't budge on its demand for a
35-cent-per-month cut in basic-cable rates, Biasatti said.

Not true, said Brian Davis, Richardson franchising and
regulatory-affairs officer.

"The city is always willing to listen to anything
AT&T has to say. But they haven't approached us," he added.

Unlike Arlington and Plano, Richardson did manage to pry an
order out of the FCC, which has already slashed three years worth of TCI rate increases.
However, the commission has not addressed its 1999 order, making a settlement likely.